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Govt warned against divestment of oil PSUs

A Parliamentary Standing Committee warned against divestment of public sector oil companies - Hindustan Petroleum Corporation and Bharat Petroleum Corporation -- and asked the government to draw a lesson from the South Korean experience where national economy had been "ruined" due to privatisation.

The committee also drew the attention of the government to the experiences of the Philippines government on the same subject and "urged the government to reconsider their decision to divest in HPCL and BPCL."

In its 36th report on the action taken by the government on its earlier recommendations (on divestment), it said that in case of divestment no Indian company, including PSUs, should be debarred from bidding for HPCL and BPCL on the ground of monopolistic character of oil companies.

"The committee have emphasised that the ministry of petroleum and natural gas seek the permission of Cabinet Commitee on Divestment for allowing the public sector oil companies to bid for HPCL and BPCL," it said.

The committee also rejected government's arguments that divestment of oil PSUs was essential for raising resources for the social sector and for realising other objectives.

"The committee have again emphasised that BPCL and HPCL, both are engaged in raising the infrastructure and already fulfilling the objectives of divestment. They have reiterated their earlier recommendations that BPCL and HPCL should not be divested," it said.

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